GST PREPARATION BY SMALL AND MEDIUM BUSINESSES

As we are aware that country is going to witness the biggest taxation reform by way of GST which is expected to be rollout by 01-July-2017. In the 15^th meeting of GST council held on 3^rd-June-2017, council had finalised some more rules and also indicated the rate of GST on textile products, footwear and precious metal. The details of indicated rates finalised by council for goods and services have been published on the website of CBEC.

Now it’s right time for the Micro, small and medium Enterprises to get ready for GST which is expected to be rollout form 01^st-July-2017. The final decision for the rollout dated is expected to be taken in the meeting of GST council being held today i.e. 11^th June-17. Following steps needed to be taken with immediate effect for smooth transition in to GST regime.

Ø  The dealer registered under the existing law i.e. Vat, Excise / Sevice tax have to get themselves migrated under GST keeping in mind their expected volume of annual business under GST Regime.

Ø  The threshold limit of sales / turnover under GST is Rs.20lacs (Rs.10lacs for specified states). The dealers having turnover under threshold limit needed to work out their gravity of business exigency before migrating in to GST as the compliance under GST is going to be very stringent.

Ø  Following step should be taken for the smooth transition in to GST;

a.       Take the stock of all raw material, work in progress and Finished goods lying within factory along with aging analysis.

b.      Details of stock lying with Job workers.

c.       Take the stock of packing material.

d.      Identify the invoices of supplier for such stock.

e.      The invoice should contain the name of entity and duty paid (VAT or Central Excise) on such goods.

Ø  The input tax credit as mentioned on the invoices or deemed credit on stock lying on the day prior to the appointed day can be taken within 90 days  by filling the stock statement in the prescribed format.

Ø  Finalise the software as software plays a crucial role in your successful implementation of GST.

Ø  Send the letter/Mails to your supplier/vendor asking the details of

a.       GST no or provisional registration number,

b.      HSN code or Service accounting code,

c.       PAN No.

d.      Registered address,

e.      Contact no, f. Email id etc.

Ø  Update the Master’s of all your vendors/supplier by filling the above mentioned details.

Ø  All supply made on or after 01-July-2017 will be covered under GST, so plan accordingly.

Ø  The supplier who is not going to registered under GST is termed as UNREGISTERED Vendor and GST on such value is to be paid by entity himself so plan your purchase accordingly.

Ø  Each entity has to file minimum 3 monthly return and time of such return and details of same is mentioned below:

a.       Sales details need to submitted by 10th of next month

b.      Purchase details to be confirmed between 11th to 15th of next month (This return will be filed by your supplier by putting your GST no)

c.       BY 20th of next month you have to file combine return and make the payment.

d.      Late fees if Rs.100 per day.

e.      Annual return is to be filed by 30th September after completion of financial year.

Ø  It is also advisable to recruit the supporting staff considering the expected work and volume of your entity.

Ø  There are mainly three types of GST namely CGST, SGST and IGST which is payable as below:

a.       If supply is made within state then charge CGST and SGST

b.      If supply is made interstate then charge and pay IGST.

c.       If supply is made to union territory the charge and collect UTGST and CGST.

d.      If supply is made to SEZ or EXPORT then IGST

e.      Finalise the invoice format.

Ø  If you are selling the goods through your agent then agent need to take registration and invoicing need to be done on Agent based on his location.

Ø  The credit under GST is available only if it is disclosed in GST return so send your GST no to all your supplier specially: Telephone operator Raw material supplier Mobile service provider Packing material supplier Airline ticket agent Chemical supplier Transporter Courier Service etc.

Ø  There are separate treatment of sales return and purchase return in GST so plan accordingly.

For any specific query related to your business and industry do contact your GST consultants.